Wednesday, February 01, 2006
Where does it give?
The problem is that there are very strong inflationary pressures and massive deficits. So, if the Fed jacks up rates, it creates a fiscal crisis both by raising the cost of servicing the debt and by cutting already anemic average growth and therefore the capacity of taxes to pay in.
If nominated for Fed Chairman, I would not run. If elected, I would not serve. The situation is that bad, and if Bernanke comes out of it with his reputation intact, he'll be a hero on par with Keynes.
Please consider this, bloggers.
It sounds as if Bush may have, purely by accident, picked someone who a) knows what he's doing and b) has our best interests at heart. (Shhhhh! We don't want Bush trying to replace him!)
Sheila Jackson Lee occupies some size 98 shoes, those of the late Barbara Jordan. Barbara Jordan not only lifted herself up by her bootstraps, she hunted down the lion from which she made those boots by hand. It's a no excuses district.
And Jackson Lee has done some important things. She was one of the 13 who objected to Bush's installation in 2000. She has made it no secret that she thinks Bush stole 2004 and said so before the Conyers Commission. She signed on with other Judiciary Democrats to call Bush to account over NSA spying.
My concerns are summed up in two moments. In the 2003(?) SOTU, she rushed up and hugged Bush. Now, in Texas, this is the way things are done. People are Texans first, ladies or gentlemen second, Methodists/Baptists/Catholics/Nazarenes third, Republicans or Democrats fourth, and Americans fifth. But Barbara Jordan would have simply shaken Mr. Bush's hand. Assuming he offered it first.
The second was when Cindy Sheehan set up Camp Casey. The Congresswoman was on vacation. At first, it was no big deal. But the minute the police moved Sheehan and the other protestors into the ditch, Congresswoman Lee should have been out the door, down the drive, and in fourth gear. *Everyone* remembered: this is what the police did to the Freedom Marchers. In the August heat, it's not only harassment, it's dangerous.
Well, long story short, despite those doubts, I'm in. Give us the plan. What position should she be appointed to, and who needs to be phoned or written to?
I do not even trust American cash, nor government bonds. World markets will likely outperform most American assets over the next few decades.
It's probably safe to invest in your local banks and energy companies, but Russia, China, India, Europe, and even the southeast Asian "tigers" are likely to outperform the western hemisphere as a whole.
But then again, I raise koi in the Sonoran desert, so please take what I say with the appropriate portion of
fleur de sel.
The American market would have melted down but for one unfortunate fact: every other market has its problems. Europe with slow growth and high unemployment, Asia with tsunamis, earthquakes, and what is euphemistically called "lack of transparency," Latin America with corruption and political instability (mostly due to the US, but that's another story), and so on.
And then there's this problem that unless you have beaucoup bucks, you can only invest through mutual funds or their newest incarnation, exchange traded funds. They don't really tell you what you're investing in. You could be financing a chain of underage brothels, as long as it fell below ca. 3% of holdings. Most of them are the same large cap companies. And they sting you on fees and other hidden charges.
Someone I know looked at things in the Bush recession of 1990, decided there was no financial future and bought land with the intent of being completely independent. Made sense at the time. Lost everything.
The US market had a long track record of doing well over the long haul. But it has gone sideways for 5 years so people are getting antsy. Problem is, a lot of foreign markets have run a long way and are going to run out of steam at some point.
More blogs about politics.